38-783

38-783. Retired members; dependents; health
insurance; premium payment; separate account; definitions

A. Subject to subsections F, G and H of this section, the board shall pay from ASRS
assets part of the single coverage premium of any health and accident insurance for each
retired, contingent annuitant or disabled member of ASRS if the member elects to
participate in the coverage provided by ASRS or section 38-651.01 or elects to
participate in a health and accident insurance program provided or administered by an
employer or paid for, in whole or in part, by an employer to an insurer. A contingent
annuitant must be receiving a monthly retirement benefit from ASRS in order to obtain any
premium payment provided by this section. The board shall pay:

1. Up to one hundred fifty dollars per month for a member of ASRS who is not
eligible for medicare if the retired or disabled member has ten or more years of credited
service.

2. Up to one hundred dollars per month for each member of ASRS who is eligible for
medicare if the retired or disabled member has ten or more years of credited service.

B. Subject to subsections F, G and H of this section, the board shall pay from ASRS
assets part of the family coverage premium of any health and accident insurance for a
retired, contingent annuitant or disabled member of ASRS who elects family coverage and
who otherwise qualifies for payment pursuant to subsection A of this section. If a member
of ASRS and the member's spouse are both either retired or disabled under ASRS and apply
for family coverage, the member who elects family coverage is entitled to receive the
payments under this section as if they were both applying under a single coverage premium
unless the payment under this section for family coverage is greater. Payment under this
subsection is in the following amounts:

1. Up to two hundred sixty dollars per month if the member of ASRS and one or more
dependents are not eligible for medicare.

2. Up to one hundred seventy dollars per month if the member of ASRS and one or
more dependents are eligible for medicare.

3. Up to two hundred fifteen dollars per month if either:

(a) The member of ASRS is not eligible for medicare and one or more dependents are
eligible for medicare.

(b) The member of ASRS is eligible for medicare and one or more dependents are not
eligible for medicare.

C. In addition each retired, contingent annuitant or disabled member of ASRS with
less than ten years of credited service and a dependent of such a retired, contingent
annuitant or disabled member who elects to participate in the coverage provided by ASRS
or section 38-651.01 or who elects to participate in a health and accident insurance
program provided or administered by an employer or paid for, in whole or in part, by an
employer to an insurer is entitled to receive a proportion of the full benefit prescribed
by subsection A or B of this section according to the following schedule:

1. 9.0 to 9.9 years of credited service, ninety per cent.

2. 8.0 to 8.9 years of credited service, eighty per cent.

3. 7.0 to 7.9 years of credited service, seventy per cent.

4. 6.0 to 6.9 years of credited service, sixty per cent.

5. 5.0 to 5.9 years of credited service, fifty per cent.

6. Those with less than five years of credited service do not qualify for the
benefit.

D. The board shall not pay more than the amount prescribed in this section for a
member of ASRS.

E. The board shall establish a separate account that consists of the benefits
provided by this section. The board shall not use or divert any part of the corpus or
income of the account for any purpose other than the provision of benefits under this
section unless the liabilities of ASRS to provide the benefits are satisfied. If the
liabilities of ASRS to provide the benefits described in this section are satisfied, the
board shall return any amount remaining in the account to the employer.

F. Payment of the benefits provided by this section is subject to the following
conditions:

1. The payment of the benefits is subordinate to the payment of retirement benefits
payable by ASRS.

2. The total of contributions for the benefits and actual contributions for life
insurance protection, if any, shall not exceed twenty-five per cent of the total actual
employer and employee contributions to ASRS, less contributions to fund past service
credits, after the day the account is established.

3. The board shall deposit the benefits provided by this section in the account.

4. The contributions by the employer to the account shall be reasonable and
ascertainable.

G. A member who elects to receive a retirement benefit pursuant to section 38-760,
subsection B, paragraph 1 may elect at the time of retirement an optional form of health
and accident insurance premium benefit payment pursuant to this subsection as follows:

1. The optional premium benefit payment shall be an amount prescribed by subsection
A, B or C of this section that is actuarially reduced to the retiring member for life.
The amount of the optional premium benefit payment shall be the actuarial equivalent of
the premium benefit payment to which the retired member would otherwise be entitled. The
election in a manner prescribed by the board shall name the contingent annuitant and may
be revoked at any time before the retiring member's effective date of retirement. At any
time after benefits have commenced, the member may name a different contingent annuitant
or rescind the election by written notice to the board as follows:

(a) If the retired member names a different contingent annuitant, the optional
premium benefit payment shall be adjusted to the actuarial equivalent of the original
premium benefit payment based on the age of the new contingent annuitant. The adjustment
shall include all postretirement increases or decreases in amounts prescribed by
subsection A, B or C of this section that are authorized by law after the retired
member's date of retirement. Payment of this adjusted premium benefit payment shall
continue under the provisions of the optional premium benefit payment previously elected
by the retired member. A retired member cannot name a different contingent annuitant if
the retired member has at any time rescinded the optional form of health and accident
insurance premium benefit payment.

(b) If the retired member rescinds the election, the retired member shall
thereafter receive the premium benefit payment that the retired member would otherwise be
entitled to receive if the retired member had not elected the optional premium benefit
payment, including all postretirement increases or decreases in amounts prescribed by
subsection A, B or C of this section that are authorized by law after the member's date
of retirement. The increased benefit payment shall continue during the remainder of the
retired member's lifetime. The decision to rescind shall be irrevocable.

2. If, at the time of the retired member's death:

(a) The retired member was receiving a reduced premium benefit payment based on an
amount prescribed in subsection B or C of this section and the contingent annuitant is
eligible for family health and accident insurance coverage, the contingent annuitant is
entitled to receive a premium benefit payment based on an amount prescribed in subsection
B or C of this section times the reduction factor applied to the retired member's premium
benefit payment times the joint and survivor option reduction factor elected by the
retired member at the time of retirement pursuant to section 38-760, subsection B,
paragraph 1.

(b) The retired member was receiving a reduced premium benefit payment based on an
amount prescribed in subsection A or C of this section and the contingent annuitant is
eligible for single health and accident insurance coverage, the contingent annuitant is
entitled to receive a premium benefit payment based on an amount prescribed in subsection
A or C of this section times the reduction factor applied to the retired member's premium
benefit payment times the joint and survivor option reduction factor elected by the
retired member at the time of retirement pursuant to section 38-760, subsection B,
paragraph 1.

(c) The retired member was receiving a reduced premium benefit payment based on an
amount prescribed in subsection B or C of this section and the contingent annuitant is
not eligible for family health and accident insurance coverage, the contingent annuitant
is entitled to receive a premium benefit payment based on an amount prescribed in
subsection A or C of this section times the reduction factor applied to the retired
member's premium benefit payment times the joint and survivor option reduction factor
elected by the retired member at the time of retirement pursuant to section 38-760,
subsection B, paragraph 1.

H. A member who elects to receive a retirement benefit pursuant to section 38-760,
subsection B, paragraph 2 may elect at the time of retirement an optional form of health
and accident insurance premium benefit payment pursuant to this subsection as follows:

1. The optional premium benefit payment shall be an amount prescribed by subsection
A, B or C of this section that is actuarially reduced with payments for five, ten or
fifteen years that are not dependent on the continued lifetime of the retired member but
whose payments continue for the retired member's lifetime beyond the five, ten or fifteen
year period. The election in a manner prescribed by the board shall name the contingent
annuitant and may be revoked at any time before the retiring member's effective date of
retirement. At any time after benefits have commenced, the member may name a different
contingent annuitant or rescind the election by written notice to the board. If the
retired member rescinds the election, the retired member shall thereafter receive the
premium benefit payment that the retired member would otherwise be entitled to receive if
the retired member had not elected the optional premium benefit payment, including all
postretirement increases or decreases in amounts prescribed by subsection A, B or C of
this section that are authorized by law after the member's date of retirement. The
increased benefit payment shall continue during the remainder of the retired member's
lifetime. The decision to rescind shall be irrevocable.

2. If, at the time of the retired member's death:

(a) The retired member was receiving a reduced premium benefit payment based on an
amount prescribed in subsection B or C of this section and the contingent annuitant is
eligible for family health and accident insurance coverage, the contingent annuitant is
entitled to receive a premium benefit payment based on an amount prescribed in subsection
B or C of this section times the period certain and life option reduction factor elected
by the retired member at the time of retirement pursuant to section 38-760, subsection B,
paragraph 2.

(b) The retired member was receiving a reduced premium benefit payment based on an
amount prescribed in subsection A or C of this section and the contingent annuitant is
eligible for single health and accident insurance coverage, the contingent annuitant is
entitled to receive a premium benefit payment based on an amount prescribed in subsection
A or C of this section times the period certain and life option reduction factor elected
by the retired member at the time of retirement pursuant to section 38-760, subsection B,
paragraph 2.

(c) The retired member was receiving a reduced premium benefit payment based on an
amount prescribed in subsection B or C of this section and the contingent annuitant is
not eligible for family health and accident insurance coverage, the contingent annuitant
is entitled to receive a premium benefit payment based on an amount prescribed in
subsection A or C of this section times the period certain and life option reduction
factor elected by the retired member at the time of retirement pursuant to section
38-760, subsection B, paragraph 2.

I. If, at the time of retirement, a retiring member does not elect to receive a
reduced premium benefit payment pursuant to subsection G or h of this section, the
retired member's contingent annuitant is not eligible at any time for the optional
premium benefit payment.

J. A contingent annuitant is not eligible for any premium benefit payment if the
contingent annuitant was not enrolled in an eligible health and accident insurance plan
at the time of the retired member's death or if the contingent annuitant is not the
dependent beneficiary or insured surviving dependent as provided in section 38-782.

K. For the purposes of this section:

1. "Account" means the separate account established pursuant to subsection E of
this section.

2. "Credited service" includes prior service.

3. "Prior service" means service for this state or a political subdivision of this
state before membership in the defined contribution program administered by ASRS.